City stockbroker AJ Bell is going head-to-head with new, app-only investment platforms by launching by its own brand pitched at younger investors.
AJ Bell is launching a new commission-free investment app called Dodl. The app, set to launch in the first half of 2022, will let investors buy a range of stocks and funds through their phones, as well as packages of “themed investments” covering areas such as healthcare, robotics, and ethical investing.
Andy Bell, founder of AJ Bell, said: “Dodl by AJ Bell is for anyone looking for a low-cost, easy-to-use investment app to help them meet their investment goals such as saving for a house deposit, holidays or retirement.
“The intuitive investment journey and streamlined investment range will appeal particularly to those that are new to investing and want a simple way to manage their investments.”
Dodl will initially offer a selection of UK stocks, with US companies to follow. Investors will be able to take advantage of tax wrappers such as ISAs through the app. The look of the app — and the fact it is commission-free — suggests it will compete with the likes of Freetrade, a start-up UK investment app popular with millennials. Freetrade, founded in 2016, recently reached £1 billion in assets under management. It has benefitted from a boom in amateur investment during lockdowns.
While customers won’t be charged a fee for trading, Dodl will charge an annual fee of 0.15% of the value of a portfolio. That works out at £15 a year on £10,000. Bell said the cost makes Dodl “the cheapest and best value investment platforms in the market.”
Shares in AJ Bell were up 1.1% on the day.
Commission-free trading was pioneered by US startup Robinhood, which went public in a $32 billion New York IPO earlier this year. Robinhood is credited with bringing a new generation to the stock market and fueling the “meme stocks” trading frenzy at the start of 2021.
Robinhood abandoned plans to launch in the UK last year but other companies, including Freetrade, have copied some of its tactics to find success here. The growth of new platforms like Freetrade and eToro has coincided with a boom in day trading and investment around the world during the pandemic.